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Former Central High School property now has a lower price

The former Duluth Central High School. Steve Kuchera / skuchera@duluthnews.com

The Duluth school district has set a new price for the long-empty former Central High School.

It will now sell for $7.9 million, Superintendent Bill Gronseth said Friday, noting the new price reflects the current market, the property’s challenges and the likely need to demolish the school known for its sweeping views of the city and Lake Superior.

The 78-acre property — empty since 2011, a casualty of the $315 million building and consolidation plan known as the “Red Plan” — was previously listed at $13.7 million.

Issues with bedrock and public access and the need for expensive infrastructure and demolition have halted potential buyers, even after the district overcame rezoning hurdles.

In 2015 the School Board accepted an offer of $10 million from housing developers; a deal that fell through because of the cost of preparing the site. The board in 2016 rejected an offer of $14.2 million from Tischer Creek Building Co., an entity serving the interests of Duluth Edison Charter Schools, in a bid to open a high school in the Central building.

The property includes the Secondary Technical Center, part of which is still being used by district facilities management. The main STC building is reusable, said Greg Follmer, a commercial broker in Duluth who the district recently began working with. He said the back building would work for staging and equipment storage during development.

It had been several years since the district worked with a professional broker, with no visible listing for Central anywhere one might look when in the market for a multimillion dollar commercial property.

Because the property sat unsold for so long, the price had to be readjusted for today’s market, Follmer said.

The most comparable standard today for pricing the property is found in the Bluestone development near the University of Minnesota Duluth. That was made possible when the district sold Woodland Middle School property to Mark Lambert for $3 million.

Follmer said the Central listing will be on his website soon, along with state and national commercial real estate sites.

School Board member Nora Sandstad said she agreed to lower the price based on the past few years of development in Duluth and the site’s challenges.

“If it’s too low, we should have plenty of competition for the property, and if it’s too high, we can address that as time passes,” she said.

She hopes to see projects that would add to the tax base.

“Something that would improve Duluth rather than simply profit a small number of people,” Sandstad said.

Proceeds from a sale would likely go into rebuilding the district’s depleted reserves.

In recent months, the district has worked with city and county officials and local lawmakers on dealing with the challenges of the site. Sen. Erik Simonson, DFL-Duluth, introduced a bill this session that would offer tax incentives to a developer who would return the property to tax rolls. A similar bill has also been introduced in the House.

Follmer also has the Central Hillside-located Nettleton Elementary listing, which is now for sale for $150,000, down from $480,000. That school — also a victim of unclosed deals — has been vacant since 2013.